Titled Queen of the Desert, the film has been billed as "Lawrence Of Arabia with a woman".
The movie centres on Bell's experiences as she worked as a writer, archaeologist and cartographer in Iraq and Jordan in the early 20th century
It is expected to begin shooting this autumn, Deadline reports.
Ridley Scott is also reported to be working on a biopic of Bell, with Angelina Jolie in talks for the lead role.
Watch the trailer for Herzog's most recent film Into The Abyss below: